Ford is looking to cut 500 jobs at its Camacari plant, according to local media citing the metalworkers' union; workers at the plant have gone on a 24-hour strike over the situation, the report notes. Separately, MAN Latin America president Roberto Cortes announced plans to increase prices by 2% in November 2015 and 5.5% in January 2016, followed by further increases in the second quarter and second half of 2016. Local media reports that the company says margins are tight and have been narrowed by increasing competition and weak sales, with further uncertainty introduced by the falling market. The report notes that an expected drop in truck and bus production of 50% in 2015 to less than 120,000 vehicles means spare capacity of 70%, based on a total capacity of 380,000 units per year for the sector. The company is also in talks with workers on implementation of an employment protection scheme beginning in January 2016; currently a group of workers will return to work in November after being laid off for five months. The company is proposing a 20% wage decrease, though workers have rejected the proposal. Already in motion is for a group of employees to see shift and pay cuts of 10% in December 2015. MAN will maintain planned investment of BRL1 million from 2012 through 2017. Cortes also noted, according to the reports, that he expects a fleet renovation scheme will be established and that it is essential for FINAME financing to remain and to be extended to used vehicles.
Significance: Ford builds the Ecosport, Fiesta, and Ka at Camacari, with 2015 output currently projected at about 188,000 units, an increase over 2014 because of the added volume in the new Ka. Ford's production is forecast to remain about that level for the next several years, though the company's overall Brazilian output is forecast to fall from 309,672 units in 2013 to 241,600 units in 2015, with a low forecast in 2018 of 223,000 units. Overall, Brazil's medium-heavy commercial vehicle production is forecast to fall from 254,228 units in 2013 to about 134,000 units in 2015.
